Buyers are hitting the streets in full force now. We’ve had 60+ new pendings for three weeks in a row, which hasn’t happened since July. Of the 63 new pendings this week, eleven had been on the market less than 7 days, and eight had been on the market for more than 100 days.
It appears that list-price averages are going to stay above $400/sf. Remember when Carmel Valley sales averaged $330/sf for a couple of years!
Click on the link below for the complete NSDCC active-inventory data:
It used to make sense that the higher prices went, the more people would sell.
But now here we are at all-time high prices, and not many are interested. It must be due to the lack of other options – not selling looks better than selling.
New Detached-Home Listings Between Jan 1 – Feb 15
# of New Listings
Median List Price
One place where there has been some nice action is the $700,000 – $900,000 range along the I-15 corridor. There has been a steady stream of new product coming to market, and momentum is building as most sell within the first week (catching many sellers and agents by surprise).
When there are only a smattering of new listings like we’re having along the coast, buyers struggle with whether the pricing is real. A few will sell here and there, but more listings would provide more comfort to buyers, one way or another. If they see them selling, then they’d be more likely to jump in!
Analyst Chris Thornberg doesn’t think this is a bubble market, and suggested that you should go buy anything you can get your hands on.
While the current environment may have the same frenzy/intensity of the last bubble, there are three reasons it won’t blow up like it did last time:
1. Banks have learned to be flexible on foreclosures.
They figured it out – the houses being foreclosed today are those with some equity, and either the bank is getting their full pop at the trustee sale, or if they have to sell it as an REO they might make some extra dough.
2. The government is in full support of the housing market.
Tweak the accounting rules, throw money at loan-mod programs, lower rates, and literally tell the banks to not do anything to harm the economy. Uncle Sam has your back.
3. We learned that a surprising amount of people didn’t freak out over being underwater.
They have to live some place, and with some support from the previous two above, they survived.
If prices stabilize, Bernanke and his buddies will come out looking like heroes. We don’t really need prices to keep going up around here; in most parts of North SD County’s coastal region we are back to peak pricing or higher.
Prices will ebb and flow. But the vast majority of those who bought in recent years are in for the long haul, and won’t care about short-term fluctuations in value – at least not enough to panic-sell.
Though he’s just one guy, we called him because he has the dubious distinction of having predicted the 2008 market crash. His colleagues used to call him “Dr. Doom.”
He says that the money flooding the Bay Area isn’t built on speculation like the last boom.
“These are people with real money, with real incomes,” he says. “They have enough money to live in whatever cities and neighborhoods they want, so if there’s not enough high-end housing, they’ll just gentrify lower-income neighborhoods.”
And while the growth may slow, it won’t stop, Thornberg predicts. He believes the solution is a matter of adding to the housing supply. As more units come on the market, prices become more reasonable for everybody, he says.
But others argue that without policies making sure some of the housing is affordable, it’s not going to make any difference for middle-class and poor people.
“That’s completely wrong,” Thornberg says. “The evidence tends to suggest that for the most part, when you start layering rule after rule after rule on real estate developers, ultimately you end up simply hurting the supply worse.”
So what should Eaton do?
Thornberg’s answer? Buy now. Anything you can get.
If you thought their performance at the Grammys was flat and felt like slow motion, it’s because ELO didn’t have their lead violinist playing. She is front and center here in last year’s much better version:
"Jim and Donna Klinge are by far the most professional, personable and responsive realtors I have ever worked with. They provide VIP concierge level service in every area of the process of selling your home. My home was marketed so successfully that we received an offer the day after our first and only open house. Thanks to Jim's pricing and negotiating, our house is now the highest sold in our community... more "
by Ann Romanello
"Jim educated us, helped us find the perfect house, and then negotiated us a great deal. I would hate to be sitting across the negotiating table from ... more "
"Jim is thorough and will be brutally honest about the homes he shows you. He provides great service and follows through until the very end and even ... more "
"I highly recommend Jim as a buyer’s agent. Working with Jim, we closed this week on a San Diego condo. Jim prepared a list of comparable sales to ... more "